•Total revenue of $345.8 million, up 8% y/y, which is $350.8 million and up 10% y/y on a constant currency basis
•Cost reduction plan drove improved operating leverage – increasing gross margins q/q and generating positive non-GAAP net income and free cash flow in Q3
•Expecting a return to non-GAAP operating income profitability in Q4’22 positioning company to achieve FY23 FCF margin targets as well as full year non-GAAP operating income profitability outlined in three-year plan
NEW YORK, November 10, 2022 -- Wix.com Ltd. (Nasdaq: WIX) today reported financial results for the third quarter ended September 30, 2022. In addition, the Company provided its initial outlook for the fourth quarter. Please visit the Wix Investor Relations website at https://investors.wix.com/ to view the Q3’22 Shareholder Update and other materials.
“Wix continues to be the preferred platform for millions globally. Demand for building, maintaining, and growing an online presence remains healthy, driving strong business fundamentals for Wix this quarter,” said Avishai Abrahami, Wix Co-founder and CEO. "As the operating environment remains dynamic and uncertainties persist, we focused on carrying out the cost savings plan introduced last quarter while continuing to execute on strategic initiatives. Through the team’s hard work, profitability improved this quarter while we simultaneously made meaningful strides in product innovation."
Lior Shemesh, CFO at Wix, added, “Revenue came in above expectations this quarter as some stability settled in despite macro headwinds. More importantly, we are already seeing leverage and significant impact from our cost reduction plan, implemented earlier this summer. This resulted in a ~280 bps q/q improvement in non-GAAP operating margin in Q3 and sets us up to generate an anticipated $47-50 million of free cash flow (excluding HQ capex) in Q4, which would make it the most profitable quarter on a free cash flow basis in our history. We also expect to return to non-GAAP operating income profitability in Q4, the first time since 2019. We expect this profitability to continue through 2023, positioning us to achieve the FCF margin target outlined in our three-year plan.”
“Confident in our ability to generate cash flow, our board authorized a $300 million share repurchase plan, underscoring our commitment to increasing shareholder value and dilution management,” said Nir Zohar, President & COO at Wix.
Q3 2022 Financial Results
•Total revenue in the third quarter of 2022 was $345.8 million, up 8% y/y
◦Total revenue on a y/y constant currency basis was $350.8 million, up 10% y/y
•Creative Subscriptions revenue in the third quarter of 2022 was $261.1 million, up 8% y/y
◦Creative Subscriptions ARR increased to $1.07 billion, up 8% y/y
•Business Solutions revenue in the third quarter of 2022 was $84.7 million, up 8% y/y
◦Transaction revenue1 was $36.0 million, up 12% y/y
•Partners revenue2 in the third quarter of 2022 was $86.7 million, up 24% y/y
•Total bookings in the third quarter of 2022 were $352.5 million, down (6)% y/y
◦Total bookings on a y/y constant currency basis was $366.5 million, down (2)% y/y
◦Total bookings in Q3’21 was up 33% y/y due to our largest ever B2B partnership, creating a difficult y/y comparison to Q3’22
•Creative Subscriptions bookings in the third quarter of 2022 were 269.9 million , down (8)% y/y
•Business Solutions bookings in the third quarter of 2022 were $82.5 million, up 2% y/y
•Total gross margin on a GAAP basis in the third quarter of 2022 was 63%
◦Creative Subscriptions gross margin on a GAAP basis was 76%
◦Business Solutions gross margin on a GAAP basis was 22%
•Total non-GAAP gross margin in the third quarter of 2022 was 65%
◦Creative Subscriptions gross margin on a non-GAAP basis was 78%
◦Business Solutions gross margin on a non-GAAP basis was 24%
•GAAP net loss in the third quarter of 2022 was $(47.4) million, or $(0.81) per share
•Non-GAAP net income in the third quarter of 2022 was $3.6 million, or $0.06 per share
•Net cash provided by operating activities for the third quarter of 2022 was $0.3 million, while capital expenditures totaled $22.9 million, leading to free cash flow of $(22.6) million
•Excluding the capex investment associated with our new headquarters office build out, free cash flow for the third quarter of 2022 would have been $4.6 million
_______________________
1Transaction revenue is a portion of Business Solutions revenue, and we define transaction revenue as all revenue generated through transaction facilitation, primarily from Wix Payments as well as Wix POS, shipping solutions and multi-channel commerce and gift card solutions.
2Partners revenue is defined as revenue generated through agencies and freelancers that build sites or applications for other users as well as revenue generated through B2B partnerships, such as LegalZoom or Vistaprint. We identify agencies and freelancers building sites or applications for others using multiple criteria including but not limited to the number of sites built, participation in the Wix Partner Program and/or the Wix Marketplace or Wix products used, among other criteria. Partners revenue includes revenue from both the Creative Subscriptions and Business Solutions segments.
Financial Outlook
Our updated outlook reflects foreign exchange, or FX, rates that have created stronger headwinds to results since we last issued guidance.
For Q4, we expect total revenue to be $349 to $354 million, representing approximately 5 - 6% y/y growth.
For the full year, we now expect revenue to grow 9% y/y. This updated full year guidance reflects the impact of FX rates, which worsened through the third quarter and into November. Assuming FX rates remained constant from July, we would expect revenue growth for the full year to be 10%, consistent with the high end of our previous guidance.
We expect to generate positive non-GAAP operating income and FCF (excluding HQ capex) to meaningfully ramp to $47 to $50 million in Q4.
We now expect FCF excluding HQ capex for the full year to be ~2% of revenue, within our previous guidance range. Assuming FX rates remained constant since July, we expect FCF (excluding HQ capex) would be ~3% of revenue for the full year, consistent with the high end of our guidance range last quarter. This improvement will be driven by a combination of increased leverage from our completed cost reduction plan and lower marketing spend as we refocus on higher-intent users.
Changes in FX rates have had a significant impact on our reported results to date and on our expectations for the full year. Assuming y/y constant currency rates as of today:
•Our full year total revenue outlook would be ~$20 million higher, or 10-11% y/y growth
•Our full year total bookings outlook would be ~$43 million higher
•Our full year free cash flow (excluding HQ capex), would be ~$43 million higher or ~5% of revenue, consistent with the high end of the range provided in May
Conference Call and Webcast Information
Wix will host a conference call to discuss the results at 8:30 a.m. ET on Thursday, November 10, 2022. To participate on the live call, analysts and investors should register and join at https://register.vevent.com/register/BI9cc36ceb99e44521bfb6cfe3f12f8c65. A replay of the call will be available through November 9, 2023 via the registration link.
Wix will also offer a live and archived webcast of the conference call, accessible from the "Investor Relations" section of the Company’s website at https://investors.wix.com/.
About Wix.com Ltd.
Wix is a leading platform to create, manage and grow a digital presence. What began as a website builder in 2006 is now a complete platform providing users with enterprise-grade performance, security and a reliable infrastructure. Offering a wide range of commerce and business solutions, advanced SEO and marketing tools, Wix enables users to take full ownership of their brand, their data and their relationships with their customers. With a focus on continuous innovation and delivery of new features and products, anyone can build a powerful digital presence to fulfill their dreams on Wix.
For more about Wix, please visit our Press Room
Investor Relations:
ir@wix.com
Media Relations:
pr@wix.com
Non-GAAP Financial Measures and Key Operating Metrics
To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. GAAP, Wix uses the following non-GAAP financial measures: bookings, cumulative cohort bookings, bookings on a constant currency basis, revenue on a constant currency basis, non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per share, free cash flow, free cash flow, as adjusted, free cash flow margins, non-GAAP R&D expenses, non-GAAP S&M expenses, non-GAAP G&A expenses, non-GAAP operating expenses, non-GAAP cost of revenue expense, non-GAAP financial expense, non-GAAP tax expense (collectively the "Non-GAAP financial measures"). Measures presented on a constant currency or foreign exchange neutral basis have been adjusted to exclude the effect of y/y changes in foreign currency exchange rate fluctuations. Bookings is a non-GAAP financial measure calculated by adding the change in deferred revenues and the change in unbilled contractual obligations for a particular period to revenues for the same period. Bookings include cash receipts for premium subscriptions purchased by users as well as cash we collect from business solutions, as well as payments due to us under the terms of contractual agreements for which we may have not yet received payment. Cash receipts for premium subscriptions are deferred and recognized as revenues over the terms of the subscriptions. Cash receipts for payments and the majority of the additional products and services (other than Google Workspace) are recognized as revenues upon receipt. Committed payments are recognised as revenue as we fulfill our obligation under the terms of the contractual agreement. Non-GAAP gross margin represents gross profit calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization, divided by revenue. Non-GAAP operating income (loss) represents operating income (loss) calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, acquisition-related expenses and sales tax expense accrual and other G&A expenses (income). Non-GAAP net income (loss) represents net loss calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, sales tax expense accrual and other G&A expenses (income), amortization of debt discount and debt issuance costs and acquisition-related expenses and non-operating foreign exchange expenses (income). Non-GAAP net income (loss) per share represents non-GAAP net income (loss) divided by the weighted average number of shares used in computing GAAP loss per share. Free cash flow represents net cash provided by (used in) operating activities less capital expenditures. Free cash flow, as adjusted, represents free cash flow further adjusted to exclude capital expenditures associated with our new headquarters. Free cash flow margins represent free cash flow divided by revenue. Non-GAAP cost of revenue represents cost of revenue calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP R&D expenses represent R&D expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP S&M expenses represent S&M expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP G&A expenses represent G&A expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP operating expenses represent operating expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP financial expense represents financial expense calculated in accordance with GAAP as adjusted for unrealized gains of equity investments, amortization of debt discount and debt issuance costs and non-operating foreign exchange expenses. Non-GAAP tax expense represents tax expense calculated in accordance with GAAP as adjusted for provisions for income tax effects related to non-GAAP adjustments.
The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company believes that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.
For more information on the non-GAAP financial measures, please see the reconciliation tables provided below. The accompanying tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these
financial measures. The Company is unable to provide reconciliations of free cash flow, free cash flow, as adjusted, cumulative cohort bookings, non-GAAP gross margin, and non-GAAP tax expense to their most directly comparable GAAP financial measures on a forward-looking basis without unreasonable effort because items that impact those GAAP financial measures are out of the Company's control and/or cannot be reasonably predicted. Such information may have a significant, and potentially unpredictable, impact on our future financial results.
Wix also uses Creative Subscriptions Annualized Recurring Revenue (ARR) as a key operating metric. Creative Subscriptions ARR is calculated as Creative Subscriptions Monthly Recurring Revenue (MRR) multiplied by 12. Creative Subscriptions MRR is calculated as the total of (i) all active Creative Subscriptions in effect on the last day of the period, multiplied by the monthly revenue of such Creative Subscriptions, other than domain registrations in effect on the last day of the period; (ii) the average revenue per month from domain registrations; (iii) monthly revenue from other partnership agreements.
Forward-Looking Statements
This document contains forward-looking statements, within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Such forward-looking statements may include projections regarding our future performance, including, but not limited to revenue, bookings and free cash flow, and may be identified by words like “anticipate,” “assume,” “believe,” “aim,” “forecast,” “indication,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “outlook,” “future,” “will,” “seek” and similar terms or phrases. The forward-looking statements contained in this document, including the quarterly and annual guidance, are based on management’s current expectations, which are subject to uncertainty, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Important factors that could cause our actual results to differ materially from those indicated in the forward-looking statements include, among others, our expectation that we will be able to attract and retain registered users and generate new premium subscriptions; our expectation that we will be able to increase the revenue we derive from the sale of premium subscriptions and business solutions, through our partners; our expectation that new products and developments, as well as third-party products we will offer in the future within our platform, will receive customer acceptance and satisfaction, including the growth in market adoption of our online commerce solutions; our assumption that historical user behavior can be extrapolated to predict future user behavior; our expectations regarding execution of our multi-year strategic plan and cost reduction plan; our prediction of the future revenues generated by our user cohorts and our ability to maintain and increase such revenue growth; our expectation to maintain and enhance our brand and reputation; and thereby increase user retention, user engagement and sales; our expectation that our products created for markets outside of North America will continue to generate growth in those markets; our plans to successfully localize our products, including by making our product, support and communication channels available in additional languages and to expand our payment infrastructure to transact in additional local currencies and accept additional payment methods; our expectations regarding the extent of the impact on our business and operations of the COVID-19 pandemic, including uncertainty relating to expected consumer dynamics after the COVID-19 pandemic subsides, the effectiveness of government policies, vaccine administration rates and other factors; our expectation regarding the impact of fluctuations in foreign currency exchange rates on our business; our expectations relating to the repurchase of our ordinary shares and/or Convertible Notes pursuant to our repurchase program; our expectation that we will effectively manage the growth of our infrastructure; changes we expect may occur to technologies used in our solutions; our expectations regarding the outcome of any regulatory investigation or litigation, including class actions; our expectations regarding future changes in our cost of revenues and our operating expenses on an absolute basis and as a percentage of our revenues, as well as our ability to achieve profitability; our expectations regarding changes in the global, national, regional or local economic, business, competitive, market, and regulatory landscape, including as a result of increasing interest rates and inflationary pressures, lasting effects of COVID-19, and as a result of the military invasion of Ukraine by Russia; our planned level of capital expenditures and our belief that our existing cash and cash from operations will be sufficient to fund our operations for at least the next 12 months and for the foreseeable future; our expectations with respect to the integration and performance of acquisitions; our ability to attract and retain qualified employees and key personnel; our expectations about entering into new markets and attracting new customer demographics, including our ability to successfully attract new partners and grow our partner activities as anticipated and other factors discussed under
the heading “Risk Factors” in the Company’s annual report on Form 20-F for the year ended December 31, 2021 filed with the Securities and Exchange Commission on April 1, 2022. Any forward-looking statement made by us in this press release speaks only as of the date hereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise.
###
Wix.com Ltd.
CONSOLIDATED STATEMENTS OF OPERATIONS - GAAP
(In thousands, except loss per share data)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Revenues
Creative Subscriptions
$
261,066
$
241,303
$
774,211
$
703,630
Business Solutions
84,739
78,587
258,415
232,614
345,805
319,890
1,032,626
936,244
Cost of Revenues
Creative Subscriptions
62,035
57,813
193,160
171,830
Business Solutions
65,822
64,163
204,303
184,857
127,857
121,976
397,463
356,687
Gross Profit
217,948
197,914
635,163
579,557
Operating expenses:
Research and development
120,384
109,323
361,867
308,608
Selling and marketing
117,448
119,991
394,942
387,467
General and administrative
42,427
38,917
131,104
112,722
Total operating expenses
280,259
268,231
887,913
808,797
Operating loss
(62,311)
(70,317)
(252,750)
(229,240)
Financial income (expenses), net
21,142
111,917
(170,257)
288,811
Other income
131
87
235
193
Income (loss) before taxes on income
(41,038)
41,687
(422,772)
59,764
Taxes on income (tax benefit)
6,323
25,374
(36,884)
67,932
Net income (loss)
(47,361)
16,313
(385,888)
(8,168)
Basic net income (loss) per share
$
(0.81)
$
0.28
$
(6.66)
$
(0.14)
Basic weighted-average shares used to compute net income (loss) per share
58,355,542
57,313,747
57,930,336
56,970,641
Diluted net income (loss) per share
$
(0.81)
$
0.27
$
(6.66)
$
(0.14)
Diluted weighted-average shares used to compute net income (loss) per share
58,355,542
60,549,853
57,930,336
56,970,641
Wix.com Ltd.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
Period ended
September 30,
December 31,
2022
2021
Assets
(unaudited)
(audited)
Current Assets:
Cash and cash equivalents
$
299,940
$
451,355
Short-term deposits
516,770
411,687
Restricted deposits
13,644
7,012
Marketable securities
400,084
456,515
Trade receivables
35,796
30,367
Prepaid expenses and other current assets
40,769
32,877
Total current assets
1,307,003
1,389,813
Long-Term Assets:
Prepaid expenses and other long-term assets
33,476
41,554
Property and equipment, net
72,637
50,437
Marketable securities
235,997
387,341
Intangible assets and goodwill, net
84,804
89,547
Operating lease right-of-use assets
235,794
101,095
Total long-term assets
662,708
669,974
Total assets
$
1,969,711
$
2,059,787
Liabilities and Shareholders' Equity (deficiency)
Current Liabilities:
Trade payables
$
118,788
$
114,584
Employees and payroll accruals
68,145
83,251
Deferred revenues
526,764
484,446
Current portion of convertible notes, net
361,100
—
Accrued expenses and other current liabilities
86,226
62,816
Operating lease liabilities
29,294
29,201
Total current liabilities
1,190,317
774,298
Long Term Liabilities:
Long-term deferred revenues
68,954
59,966
Long-term deferred tax liability
26,856
72,803
Convertible notes, net
565,782
922,974
Other long-term liabilities
1,991
2,267
Long-term operating lease liabilities
180,227
81,764
Total long-term liabilities
843,810
1,139,774
Total liabilities
2,034,127
1,914,072
Shareholders' Equity (deficiency)
Ordinary shares
115
111
Additional paid-in capital
1,214,441
994,795
Treasury Stock
(199,997)
(199,997)
Accumulated other comprehensive income
(44,949)
(1,056)
Accumulated deficit
(1,034,026)
(648,138)
Total shareholders' equity (deficiency)
(64,416)
145,715
Total liabilities and shareholders' equity
$
1,969,711
$
2,059,787
Wix.com Ltd.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
OPERATING ACTIVITIES:
Net income (loss)
$
(47,361)
$
16,313
$
(385,888)
$
(8,168)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation
3,845
3,595
11,402
10,405
Amortization
1,581
3,045
4,735
4,490
Share based compensation expenses
56,796
53,070
176,919
150,097
Amortization of debt discount and debt issuance costs
1,305
1,297
3,908
4,000
Changes in accrued interest and exchange rate on short term and long term deposits
172
(57)
7
(105)
Amortization of premium and discount and accrued interest on marketable securities, net
1,000
1,796
3,805
6,201
Remeasurement loss (gain) on Marketable equity
(10,182)
(110,855)
196,383
(184,041)
Deferred income taxes, net
2,351
21,111
(45,868)
61,214
Changes in operating lease right-of-use assets
8,141
5,907
26,716
18,967
Changes in operating lease liabilities
(8,675)
(6,062)
(33,847)
(19,675)
Decrease (increase) in trade receivables
5,004
1,430
(5,429)
(3,871)
Increase in prepaid expenses and other current and long-term assets
(5,280)
(652)
(32,625)
(101,497)
Increase (decrease) in trade payables
(7,960)
6,727
4,153
5,699
Increase (decrease) in employees and payroll accruals
(9,562)
(628)
(14,644)
12,519
Increase in short term and long term deferred revenues
6,023
6,243
51,306
75,839
Increase in accrued expenses and other current liabilities
3,069
2,043
22,885
12,570
Net cash provided by (used in) operating activities
267
4,323
(16,082)
44,644
INVESTING ACTIVITIES:
Proceeds from short-term deposits and restricted deposits
105,171
269,000
336,430
447,015
Investment in short-term deposits and restricted deposits
(57,180)
(245,000)
(448,152)
(417,131)
Investment in marketable securities
(38,048)
—
(202,611)
—
Proceeds from marketable securities
51,619
80,909
191,869
261,568
Purchase of property and equipment and payment of prepaid expenses
(22,208)
(12,604)
(54,120)
(22,981)
Capitalization of internal use of software
(666)
(426)
(1,895)
(1,017)
Investment in other long-term assets
(580)
—
(580)
—
Proceeds from equity securities
—
18,771
3,193
18,771
Payment for Businesses acquired, net of acquired cash
—
189
—
(42,614)
Purchases of investments in privately held companies
(100)
(2,000)
(1,260)
(3,500)
Net cash provided by (used in) investing activities
38,008
108,839
(177,126)
240,111
FINANCING ACTIVITIES:
Proceeds from exercise of options and ESPP shares
19,779
11,752
41,793
33,554
Purchase of treasury stock
—
(200,000)
—
(200,000)
Net cash provided by financing activities
19,779
(188,248)
41,793
(166,446)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
58,054
(75,086)
(151,415)
118,309
CASH AND CASH EQUIVALENTS—Beginning of period
241,886
362,253
451,355
168,858
CASH AND CASH EQUIVALENTS—End of period
$
299,940
$
287,167
$
299,940
$
287,167
Wix.com Ltd.
KEY PERFORMANCE METRICS
(In thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Creative Subscriptions
261,066
241,303
774,211
703,630
Business Solutions
84,739
78,587
258,415
232,614
Total Revenues
$
345,805
$
319,890
$
1,032,626
$
936,244
Creative Subscriptions
269,937
292,737
839,645
823,841
Business Solutions
82,527
80,560
260,661
243,426
Total Bookings
$
352,464
$
373,297
$
1,100,306
$
1,067,267
Free Cash Flow
$
(22,607)
$
(8,707)
$
(72,097)
$
20,646
Free Cash Flow, excluding capex related to future Wix HQ office build-out
$
4,559
$
1,663
$
(19,582)
$
34,048
Creative Subscriptions ARR
$
1,071,045
$
992,295
$
1,071,045
$
992,295
Wix.com Ltd.
RECONCILIATION OF REVENUES TO BOOKINGS
(In thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Revenues
$
345,805
$
319,890
$
1,032,626
$
936,244
Change in deferred revenues
6,023
6,243
51,306
75,839
Change in unbilled contractual obligations
636
47,164
16,374
55,184
Bookings
$
352,464
$
373,297
$
1,100,306
$
1,067,267
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Creative Subscriptions Revenues
$
261,066
$
241,303
$
774,211
$
703,630
Change in deferred revenues
8,235
4,270
49,060
65,027
Change in unbilled contractual obligations
636
47,164
16,374
55,184
Creative Subscriptions Bookings
$
269,937
$
292,737
$
839,645
$
823,841
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Business Solutions Revenues
$
84,739
$
78,587
$
258,415
$
232,614
Change in deferred revenues
(2,212)
1,973
2,246
10,812
Business Solutions Bookings
$
82,527
$
80,560
$
260,661
$
243,426
Wix.com Ltd.
RECONCILIATION OF COHORT BOOKINGS
(In millions)
Nine Months Ended
September 30,
2022
2021
(unaudited)
Q1 Cohort revenues
$
29
$
39
Q1 Change in deferred revenues
18
21
Q1 Cohort Bookings
$
47
$
60
Wix.com Ltd.
RECONCILIATION OF REVENUES AND BOOKINGS EXCLUDING FX IMPACT
(In thousands)
Three Months Ended
September 30,
2022
2021
(unaudited)
Revenues
$
345,805
$
319,890
FX impact on Q3/22 using Q3/21 rates
4,983
—
Revenues excluding FX impact
$
350,788
$
319,890
Y/Y growth
10
%
Three Months Ended
September 30,
2022
2021
(unaudited)
Bookings
$
352,464
$
373,297
FX impact on Q3/22 using Q3/21 rates
14,073
—
Bookings excluding FX impact
$
366,537
$
373,297
Y/Y growth
(2)
%
Wix.com Ltd.
TOTAL ADJUSTMENTS GAAP TO NON-GAAP
(In thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(1) Share based compensation expenses:
(unaudited)
(unaudited)
Cost of revenues
$
4,418
$
4,057
$
13,204
$
11,367
Research and development
29,606
26,250
88,245
74,028
Selling and marketing
9,261
8,715
29,155
24,370
General and administrative
13,511
14,048
46,315
40,332
Total share based compensation expenses
56,796
53,070
176,919
150,097
(2) Amortization
1,581
3,045
4,735
4,490
(3) Acquisition related expenses
585
2,579
3,471
6,635
(4) Amortization of debt discount and debt issuance costs
1,305
1,297
3,908
4,000
(5) Sales tax accrual and other G&A expenses (income)
183
341
544
1,372
(6) Unrealized loss (gain) on equity and other investments
(8) Provision for income tax effects related to non-GAAP adjustments
2,342
21,480
(45,902)
61,008
Total adjustments of GAAP to Non GAAP
$
50,935
$
(28,608)
$
340,241
$
(51,726)
Wix.com Ltd.
RECONCILIATION OF GAAP TO NON-GAAP GROSS PROFIT
(In thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Gross Profit
$
217,948
$
197,914
$
635,163
$
579,557
Share based compensation expenses
4,418
4,057
13,204
11,367
Acquisition related expenses
—
108
140
387
Amortization
759
930
2,279
1,385
Non GAAP Gross Profit
223,125
203,009
650,786
592,696
Non GAAP Gross margin
65
%
63
%
63
%
63
%
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Gross Profit - Creative Subscriptions
$
199,031
$
183,490
$
581,051
$
531,800
Share based compensation expenses
3,503
2,947
10,496
8,420
Non GAAP Gross Profit - Creative Subscriptions
202,534
186,437
591,547
540,220
Non GAAP Gross margin - Creative Subscriptions
78
%
77
%
76
%
77
%
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Gross Profit - Business Solutions
$
18,917
$
14,424
$
54,112
$
47,757
Share based compensation expenses
915
1,110
2,708
2,947
Acquisition related expenses
—
108
140
387
Amortization
759
930
2,279
1,385
Non GAAP Gross Profit - Business Solutions
20,591
16,572
59,239
52,476
Non GAAP Gross margin - Business Solutions
24
%
21
%
23
%
23
%
Wix.com Ltd.
RECONCILIATION OF OPERATING LOSS TO NON-GAAP OPERATING LOSS
(In thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Operating loss
$
(62,311)
$
(70,317)
$
(252,750)
$
(229,240)
Adjustments:
Share based compensation expenses
56,796
53,070
176,919
150,097
Amortization
1,581
3,045
4,735
4,490
Sales tax accrual and other G&A expenses
183
341
544
1,372
Acquisition related expenses
585
2,579
3,471
6,635
Total adjustments
$
59,145
$
59,035
$
185,669
$
162,594
Non GAAP operating loss
$
(3,166)
$
(11,282)
$
(67,081)
$
(66,646)
Non GAAP operating margin
(1)
%
(4)
%
(6)
%
(7)
%
Wix.com Ltd.
RECONCILIATION OF NET INCOME (LOSS) TO NON-GAAP NET LOSS AND NON-GAAP NET LOSS PER SHARE
(In thousands, except per share data)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Net income (loss)
$
(47,361)
$
16,313
$
(385,888)
$
(8,168)
Share based compensation expenses and other Non GAAP adjustments
50,935
(28,608)
340,241
(51,726)
Non-GAAP net income (loss)
$
3,574
$
(12,295)
$
(45,647)
$
(59,894)
Basic and diluted Non GAAP net income (loss) per share
$
0.06
$
(0.21)
$
(0.79)
$
(1.05)
Weighted average shares used in computing basic and diluted Non GAAP net income (loss) per share
58,355,542
57,313,747
57,930,336
56,970,641
Wix.com Ltd.
RECONCILIATION OF NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES TO FREE CASH FLOW
(In thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Net cash provided by (used in) operating activities
$
267
$
4,323
$
(16,082)
$
44,644
Capital expenditures, net
(22,874)
(13,030)
(56,015)
(23,998)
Free Cash Flow
$
(22,607)
$
(8,707)
$
(72,097)
$
20,646
Capex related to future Wix HQ office build-out
27,166
10,370
52,515
13,402
Free Cash Flow, excluding capex related to future Wix HQ office build-out
$
4,559
$
1,663
$
(19,582)
$
34,048
Wix.com Ltd.
RECONCILIATION OF BASIC WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING AND THE DILUTED WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING
Three Months Ended
Nine Months Ended
September 30,
September 30,
2022
2021
2022
2021
(unaudited)
(unaudited)
Basic weighted-average shares used to compute net income (loss) per share
58,355,542
57,313,747
57,930,336
56,970,641
Effect of dilutive securities (included in the effect of dilutive securities is the assumed conversion of employee stock options, employee RSUs and the Notes)
—
3,236,106
—
—
Diluted weighted-average shares used to compute net income (loss) per share
58,355,542
60,549,853
57,930,336
56,970,641
The following items have been excluded from the diluted weighted average number of shares outstanding because they are anti-dilutive:
